The Benefits of an Employee Benefits Plan
Taking Care of Your Employees
Great companies take good care of their employees. That’s why you’re out here shopping for the right employee benefits plan– one that will compliment both your employees and you.
The first step is to make sure you’re thinking about it the right way. A good benefits package isn’t a black hole that sucks in profits while offering nothing to you, the employer (though it can seem like that). Remember that a benefits plan is an investment in the strongest aspect of your business – your employees. It will help you to recruit and retain a highly-skilled, dedicated staff, and this will put money in your pocket.
Price Considerations – Value vs. Cost
The cheapest benefits plan is never going to be the right plan for your employees or you, but price is one factor in creating a plan that works for both you and your employees. But more important than base price, is finding what your employees want, in a price range that works for you.
A good advisor will work with you to create a benefits plan that’s not only within your budget, but will add value for your employees. This is crucial, because if your employees view their benefits plan as second-rate, it’s not going to add value to your company.
A bad advisor will sell you what you don’t need at a price that is too good to be true. If the price quoted looks unsustainable, it probably is. Unscrupulous brokers often play pricing games and offer a quote that is much lower than it should be. Then, in a year or two, they’ll raise the price, and you’ll be stuck with higher than expected costs and a broker you can’t trust.
Here are the Three P’s to consider when shopping for a good benefits plan:
- Process – Make sure the insurance company has a good customer service history
- Product – Find the right product that works for you and your employees
- Price – As in everything, you want a good value for your money
Good process leads to good product. A good process coupled with a good product both support a good and sustainable price. These three factors create the best outcome in a benefits plan, and they’re what you should look for.
Why Have a Benefits Plan? – The Benefits of a Benefits Plan
Sure, it is an added expense for your business – but it’s also a tool for recruiting and retaining a stable workforce that will help your business shine.
Features of a great benefit plan:
- Attracts and Retains Talent – A good wage is important to bring in talented, hard-working employees. And a good benefits plan adds extra value to the compensation package, especially for established employees with families. Money is nice, but a benefits package gives your employees peace of mind, which is priceless.
- Improves Productivity – Stress can make a good employee into an unreliable employee very quickly. By helping your employees take care of their health – physically and mentally – and the health of their family, you make it easier for them to focus on their work.
- Easy to Administer – A good plan will function largely by itself, leaving you to do what you do best – running your business.
- Tax-deductible Business Expense – Unlike salary or wage increases, employee benefit premiums paid by the employer are not a taxable benefit to the employee. They also do not attract payroll taxes. So if strategic tax planning is on your list this year, consider your benefit plan premiums an important piece of the puzzle.
A Benefits Plan for Your Employees, by Your Employees
The best benefit plans, the ones with the most return on investment, are the plans that are custom tailored to you, your industry, and your employees. Depending on your employee’s age distribution, geographic location, and even personal circumstances, different plans will appeal to them. And, depending on your industry – white collar, blue collar – different plans will offer your employees peace of mind.
No matter, how much you shop around, and do your homework on the internet, you will never know what is best for your employees if you don’t ask them. If you can find a plan that meets the exact needs of your employees, you will get the most out of a benefits plan – and so will they.
So, before you do anything else, open the conversation with your employees and find out what’s most important to them in a benefits package.
In the end, when your employees prosper, your company prospers. So make sure your employees know you care about their well-being, and they will do their best work for you.
Download our whitepaper, A Guide to Buying Employee Benefits